O’Connor Hospital and six other facilities that are part of the Daughters of Charity Health System have been sold to a for-profit multi-state chain, but locally there is concern that the deal will present challenges if the sale is approved by the state Attorney General.

In 2013 Daughters of Charity hospitals, which began operating in California in 1852, collectively saw 172,000 emergency room visits and provided more than $159 million in uncompensated care and services to people in financial need. It is San Jose’s only Catholic hospital.

The chain of hospitals announced in February that it was planning to sell, in part because of huge financial losses. Now, its president and CEO Robert Issai says the company narrowed a bevy of prospective buyers to Prime Healthcare Services on Oct. 10.

“In selecting candidates to take over the hospitals, our priority was to seek the best buyer who could guide our hospitals into a successful future while honoring the obligations to our associates, retirees and other constituents,” said Issai.

Santa Clara County had placed a bid on the hospital in an attempt to garner more beds for patients, many of whom rely on county and state funded health care.

Neighboring county-run Santa Clara Valley Medical Center is the only other hospital in the area that serves substantial numbers of those patients, as Regional Medical Center in East San Jose and downtown’s San Jose Medical Center were purchased by another for-profit medical group, HCA.

There is concern that if O’Connor and South County’s St. Louise in Gilroy are sold to the for-profit company, Valley Medical Center will need to shoulder care for too many patients.

Jeff Smith, county executive, said that most patients who are uninsured would, in both San Jose and South County, end up at Valley Medical Center.

“We know this particular provider has a history of purchasing distressed hospitals; the way they make them profitable is quite slick,” he said. “That kind of practice would mean that the safety net component provided by Daughters of Charity would be sort of dumped on the county.”

Smith said that the county would face costly expansion of Valley Medical Center to accommodate a large influx of patients who would no longer be served at O’Connor and St. Louise.

He said that Santa Clara County officials intend to set up a meeting with the Attorney General to express concerns about the sale.

Prime Healthcare Services officials stated in a press release that the company will uphold the tradition and character of the hospital, as well as staff members’ union contracts–though the union has expressed extreme concern.

“We are truly honored to be chosen by the DCHS Board of Directors to extend their mission of care delivered for decades by the doctors, nurses and staff so dedicated to the well-being of their patients,” said Prem Reddy, CEO and president of Prime.

Prime operates 29 hospitals in nine states, including four other Catholic hospitals purchased in the past two years.

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